Tesla are on a mission to solve massive problems for humankind while taking into account modern humans' lack of commitment to solving those problems in a way that would feel like a step back, or that would create discomfort. Tesla's existence as a market solution to the oil and pollution problems is evidence that you don't always need political coercion to solve problems like externalities: Tesla's cars are not only electric cars - i.e. the answer to a problem that could potentially destroy civilisation as we know it - they are also great cars, by any "petrolhead" standard.
As a company and an investment, Tesla's long term mission, its strategy and its step-by-step tactics have been presented in a way that is extremely rare for a company. Most of the work I do for brands this size involves working with a 5-year plan that is nowhere near as clear as Tesla's, and the plans are 5-years because that's when the owners' exit plan kicks in. Tesla's strategy set a clear path for 15 years at least.
So what's not's not to like? I think many investors feel they may have missed the boat on the next great world company. It's quite normal to sit on the edge for a while, to miss out on the opportunity, and to then find a dozen reasons to tell oneself it was good to pass on it.
Just trolling, I agree with your points. I'm just saying that any posts about publicly traded companies should be taken with a grain of salt.
I agree, and specifically I think of the confusion between gross profit margin and net operating cashflow. Tesla makes money on every car sold (as they actually have a gross profit) but have been spending cash really fast (as they have a negative cashflow). All this really tells you is that Tesla is investing a lot of money, which is to be expected for a company that is trying to spearhead a paradigm shift within the entire automotive industry.
Also, since one big weakness in Tesla is whether it relies on government subsidies and loans for its continued survival. Thats something I don't understand and if I had a horse in this race, I'd be weary of a company that relies on the whims of political support in order to survive.
Regarding subsidies, the "good" news there is that at least in the US, there isn't much in the way of uncertainty, because the US federal subsidy starts to drop off at 200,000 units per manufacturer and is unlikely to be expanded. Given how quickly they're moving, they'll probably hit that within the next few years and one way or another they'll have to learn to do without. But at least they won't be waiting for politicians to drop the knife on them.
You knock people for financial ignorance, then say this?
You realize that gross margin is sales less cost of goods sold? And that cost of goods does not include things like paying your employees, interest on debt used to expand, the cost of running the factories, etc etc?
I come from a retail environment where our gross margin is typically 25-35%, while our profit margin is about 2-4%. So saying that Tesla "makes money on every car sold" simply because they have "gross profit" is about as fast and loose with "profit" as you can get. Of course, nobody in the finance world would think that...
That said, the reason he's polarizing may be because of other information that's readily available due to a concerted effort by short-sellers.
Oh, brother. This article is from a massive, mainstream financial news site, and is reposted all over the internet. But the short-sellers come here, to a niche tech site, to try to influence people to...what exactly?
Buy / sell Tesla stocks; the general audience here is the hip Silicon Valley startup crowd, of which some are 20-some year old instant-millionaires whose hip startup was bought by Google/Facebook/Paypal/etc, or who are making over 100K a year. You probably shouldn't underestimate the net worth and expendable income of the crowd here, or how easily they're influenced. It doesn't take much to get a stock to travel in an upwards direction, and even the slightest increase will cause some people or organizations to make a lot of money.
If I had the right circumstances to make it feasible, I wouldn't hesitate getting a Model S.
I'm really really hungry for competence in both manufacturing and design, which is something that is sorely lacking in the current large US car companies. Based on their current track record, Tesla has a much better chance of delivering than Ford or GM.
I think it's more a matter of being shortsighted. If the ads from this season of the Startup podcast are any indication, they are so busy focusing on small pieces of the experience (such as having designing wear suits to simulate feeling old, etc) that they are missing the major advances. It's somewhat understandable, the major automakers have been making basically interchangeable cars for a few years, so spending time to enhance the entire experience in many small ways seems to make sense. That is, until some upstart shows up with something radically better.
Like a lot of legacy systems, right? Tesla has an advantage of starting from scratch, sure.
"This is not something that MBA-type management can buy their way out of, because they have no competence,"
No competence? These are century old companies that have created vast amounts of global wealth and emply hundreds of thousnads of people in what are still well-paying jobs. Yeah, no competence whatsoever.
Of course, I suppose if you knew that Tesla has hired engineers and managers from some of these companies that have "no competence"...
Not sure why you're talking about engineers when I'm clearly talking about management. Also, today's management is not the management that built the companies or their wealth, so it's specious to suggest that that has any relevance on the evaluation of the current management. And finally, Tesla hiring the few competent managers is not a sign that those that remain at the current car companies are, as a whole, competent. While there are certainly individual managers that are competent in GM or Ford, the structure as a whole does not make good decisions, in my opinion.
With that in mind, I doubt it'll happen, but I'd still be curious what Apple could do if they made a car's display/OS (not counting Apple Carplay, of course).
Please, elaborate on all the design stupidity that the Tesla solves.
I've test driven a Tesla. It's awesome, thanks to the amazing torque delivery that comes from electric motors. It's a paradigm shift for a long time car guy, and has to be experienced to be understood.
..but, other than that...it's just a luxury car. What exactly has it "solved" that every other car company is still doing "stupidly"?
It may have a luxury price and technically it is very impressive but the interior quality is ridiculously poor for a car this expensive. I've sat in Hyundai and Daewoos that had better quality finishes and leathers.
When it is, I'll happily drop the majors for a Tesla.